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Swing Trade Ideas – June 15, 2020

Market View

Markets are broadly negative ahead of the USA open with Europe and Asia in the red, oil prices lower, and yield curve flatter. Catalyst is a Covid outbreak in Beijing and increases in the USA. The strongest USA index is the Nasdaq and the weakest is the Russell. The cyclical stocks(banks, industrials, materials), which were underperformers before the Covid issue are leaders to the downside. S&P500 is below the 200 SMA (300) and a retake is an upside target. The gamma levels are negative, which can lead to market makers selling into down moves. SPY 295 is a key level which can lead to a bounce or sharp selling below with 290 a key level below.

Premarket names:

SHOP  partnership with WMT and upgrad; MRNA news; Quarantine stocks like NFLX, ZM etc are up with a weak tape

Stock Idea; SHOP

SHOP is up in the premarket with news of a partnership with WMT and an upgrade. Technically SHOP was set-up for a move with a Bollinger band squeeze.  Accumulation has been strong through the consolidation. SHOP can benefit from a rotation back into quarantine names much like in April.  Would be careful with longs with a weak tape. Diagonal breakout above 760.